Should Value Investors Buy Lions Gate Entertainment (LGF.A) Stock?

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Looking at the history of these trends, perhaps none is more beloved than value investing. This strategy simply looks to identify companies that are being undervalued by the broader market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.

One company to watch right now is Lions Gate Entertainment (LGF.A). LGF.A is currently sporting a Zacks Rank of #2 (Buy), as well as an A grade for Value. The stock is trading with P/E ratio of 11.88 right now. For comparison, its industry sports an average P/E of 25.37. Over the past year, LGF.A's Forward P/E has been as high as 26.10 and as low as 9.98, with a median of 14.66.

Investors should also note that LGF.A holds a PEG ratio of 1.13. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. LGF.A's industry has an average PEG of 1.54 right now. LGF.A's PEG has been as high as 1.74 and as low as 0.91, with a median of 1.21, all within the past year.

Value investors also love the P/S ratio, which is calculated by simply dividing a stock's price with the company's sales. This is a prefered metric because revenue can't really be manipulated, so sales are often a truer performance indicator. LGF.A has a P/S ratio of 0.6. This compares to its industry's average P/S of 1.36.

These are just a handful of the figures considered in Lions Gate Entertainment's great Value grade. Still, they help show that the stock is likely being undervalued at the moment. Add this to the strength of its earnings outlook, and we can clearly see that LGF.A is an impressive value stock right now.

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Lions Gate Entertainment Corp. (LGF.A) : Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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